Technology has played a compelling role in business operations. The advent of the Internet has created a new methodology to transact business faster and more cheaply in limited time and space.
The Internet is made up of thousands of interconnected networks that are connected around the world. The use of the Internet in business has allowed business to be conducted worldwide in front of unlimited audiences and it is one of the best methods of globalizing business. The Internet is a powerful tool to gain a business strategy that helps companies compete with their competitors and improve customer satisfaction. Hence, the internet business model was formulated to help companies choose the right model at the right time.
Internet business simply isn’t about designing websites to promote the products it has to automate through its unique process. E-commerce helps manufacturers understand customers’ wants and needs by understanding their behavior when they visit company websites or research relevant information, and this in turn helps manufacturers and marketers customize and personalize products.
Internet business has greatly changed the marketing practices of companies and as a result, marketers must be ever more proactive and creative to reach their audience and persuade them to buy products.
Today, many companies have also set up extranets with their suppliers to facilitate information sharing, transactions and payments. Internet business gave birth to e-commerce which is becoming more and more specific compared to internet business or e-business. The term e-commerce encourages businesses to sell their products or services over the internet. More specifically about the internet business; They are simply businesses that use the internet to a worldwide audience to globalize the business.
Advantages of Internet Business – Internet business has its unique advantages
No physical location is required and therefore you do not need to own or rent a business incorporation location as is required for traditional businesses.
Of course, you need a DOMAIN NAME for website registration and it is very cheap that you can get around $5~$25 with free web hosting service.
You need a website to sell your product or service. If you are skilled in programming and design you can always do it yourself or hire a web developer and/or designer based on your needs or even become an affiliate of a website that doesn’t require a website as your reseller will provide you with a website .
You can promote your products or services for free on most websites, e.g. For example, on the free classifieds site.
Because the Internet works 24×7, you can reach your customers at any time.
Internet business is not geographically specific and therefore you can reach a global audience.
Disadvantages of Internet Business – Of course, the Internet has great advantages, but it also has some disadvantages.
It is very difficult for the user to know what is genuine and what is not over the Internet as users cannot “touch and feel” some products before purchasing them.
The Internet makes you feel isolated and therefore separates manufacturer and customer, ultimately leading to a lack of trust between two parties.
It is also difficult for the user to select the product as there can be many products with different variants advertised over the internet.
Every company needs a model to run their business and operations. When it comes to the Internet, it’s not as if companies designed or built their own models. Most companies support the following business models over the Internet.
Let’s understand the six proven internet business models above.
Products: This Internet business model includes items such as electronic goods, books, computer hardware and software, household goods, jewelry, etc. Businesses can already use direct marketing to market their products.
Adopting this model is the most cost-effective method of universal communication, and consumers can view the product through the company’s website or online catalog because it costs a fraction of what the printed catalog costs and duplication is achieved virtually . The crucial part is to note that the internet is not the business strategy. However, it helps companies formulate strategies more effectively and efficiently. These are none other than the internet or online retailers.
Professional/Specialist Services: This model includes professional services such as accountants, consultants, architects, etc. The use of technology has encouraged service firms to develop innovative strategies to support the very nature of the business.
The service industry is promoting their services electronically i.e. via the internet and as the internet is reaching a global audience by breaking the geographic barriers, the service sectors are enjoying massive gain and growth today as the internet has surpassed traditional advertising and its potential reached the audience directly.
Information Business: This e-business model is for those who collect, create and sell knowledge. The internet has given a new space to this type of business. Nowadays, people use the internet for many reasons and searching for information on the internet is the number one priority. Many Netpreneurs today have adopted this business methodology and created a success because there is a lot of scope for business in this digital age and information business is one such business that is growing at full speed.
Internet Careers: Many people have started to make careers on the Internet themselves. This business model includes graphic artists, web designers and developers, software programmers, computer and software trainers via online, internet marketing professionals, etc. This is considered to be the fastest growing business and many people have started a business model.
Electronic Publishing: Today, people can find free news, magazines, and newsletters in digital format. Under this business model, any factual written material can be published in digital form and uploaded to the website. Online or electronic publications are exploding because they are too cost effective compared to the printed version of newspapers, magazines, newsletters, etc. There are many innovative ways a company can generate revenue with this business model.
E-Advertising: Electronic advertising, the business model that is constantly growing and aims to outperform traditional advertising methods. With this business model, companies can easily sell advertising space on the web, which in turn creates a mutual understanding between both parties (advertisers and publishers).
Advertisers get revenue by publishing advertisements on their website, and publishers get traffic to their website and/or brand awareness for their (publisher’s) product through advertisements. This is really big business and one can monetize his/her website (if available) simply by selling the website space.
The internet business model mentioned above has been adopted by many companies and has made history in this digital age. Thus, the Internet has become the right source and a powerful tool for the companies to create a new and innovative business strategy to stay in the market.
Different authors have defined internet business models in different ways, but the actual message and meaning is the same. To see the different terms of the internet business model, check out this article. read here
As a wannabe internet entrepreneur, you need to analyze which internet business model suits you best or where you actually fit in the overall scenario.